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Testing Fraud: Woman Arrested for Conspiracy Involving Both Genetic and COVID-19 Tests

May 19, 2020

On May 15th, federal authorities in Florida arrested a Georgia woman for testing fraud. The criminal complaint charges Ashley Hoobler Parris with conspiring to violate the Anti-Kickback Statute (AKS) and to defraud Medicare by submitting false and fraudulent claims for cancer genetic testing (CGX) and for COVID-19 testing. The press release issued by the Department of Justice (DOJ) describes the scheme. Unfortunately, it is a scheme that has become all too familiar.

Genetic Testing Fraud Scheme

Beginning in about October 2018, Hoobler allegedly began soliciting and receiving kickbacks from diagnostic laboratories for referring Medicare beneficiaries for expensive CGX testing. Medicare reimburses these tests only under limited circumstances, and it requires that the physician who is treating the beneficiary order the tests. We have sounded the alarm about this type of scheme before. As Bob Thomas explained in Stat News, once Medicare began covering expensive genetic tests, scammers saw a golden opportunity.

If you can get a saliva swab and a Medicare number from an unsuspecting senior and falsify a doctor’s order (or find a shady doctor to write one), there’s an easy four-figure sum to be had. And if you’re willing to repeat that dodge a few hundred or a few thousand times – you get the idea.

In addition, Bob appeared on CBS News to discuss genetic testing fraud. What he described is what the complaint alleges Hoobler and her co-conspirators to have done in this case. One, obtain Medicare information and saliva swabs from seniors, regardless of whether CGX testing is medically necessary. Two, pay kickbacks to co-conspirators at telemedicine companies in exchange for physician orders for the expensive tests. Three, send the swabs and doctors’ orders to laboratories in exchange for kickbacks. Four, have labs submit false and fraudulent claims to Medicare.

COVID-19 Testing Fraud

As the COVID-19 crisis began, whistleblower attorneys warned that scammers would take advantage of the situation to cheat taxpayers. Our firm predicted that we likely would see coronavirus test frauds similar to the CGX testing schemes. Sadly, that prediction already has come true.

According to the complaint, as the pandemic escalated in the United States, certain laboratories agreed to pay kickbacks to Hoobler and her co-conspirators in exchange for COVID-19 tests, so long as they were bundled with more-expensive Respiratory Pathogen Panel (RPP) tests. Medicare reimburses RPP tests at a much higher rate than it does COVID-19 tests.

Ms. Hoobler’s arrest may be the first but it will not be the last for COVID-19 testing fraud. As we’ve noted, because Congress has allocated funds for testing without copayments, scammers will use the same playbook for these tests as they have for CGX. They will push “free” testing on Medicare beneficiaries regardless of medical necessity. Then, they will pay kickbacks to doctors to order tests for patients they’ve never seen and are not treating. Finally, they will conspire with labs to get a share of the Medicare reimbursement in exchange for sending them the fake orders and patient information.

Vigilance is Key

DOJ and the Department of Health and Human Services are committed to holding accountable persons who exploit the COVID-19 crisis in order to cheat Medicare and taxpayers. Maria Chapa Lopez, the U.S. Attorney for the Middle District of Florida stated:

Fraud related to COVID-19 is particularly disturbing as it exploits a national crisis for personal gain. The U.S. Attorney’s Office and our law enforcement partners remain focused on investigating and prosecuting individuals seeking to defraud federal government programs for personal profit, especially during this pandemic.

To get through this crisis, we must all work together. If you have information about testing fraud, please contact us.